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VANCOUVER, BC, Jan. 22, 2021 /CNW/ - Serengeti Resources
Inc. (TSXV: SIR) ("Serengeti") and Sun Metals Corp. (TSXV:
SUNM) ("Sun Metals") are pleased to announce that Sun Metals
has obtained an interim order from the Supreme Court of
British Columbia with respect to
the previously announced proposed plan of arrangement, pursuant to
which Serengeti will acquire all of the issued and outstanding
shares of Sun Metals, on the basis of 0.215 of a post-Consolidation
(as defined below) Serengeti share for each Sun Metals share, which
is 0.43 of a pre-Consolidation Serengeti share for each Sun Metals
share on a pre-Consolidation basis (the
"Transaction"). Each company will mail out a joint
management information circular in connection with the holding of
special meetings of the securityholders of Sun Metals, which will
be held in accordance with the interim order, and shareholders of
Serengeti to approve the Transaction and related matters. The
meetings are scheduled to be held concurrently on February 26, 2021, with the record date for
Serengeti shareholders and Sun Metals securityholders to receive
notice of and vote at each of the Serengeti meeting and Sun Metals
meeting having been set at January
15, 2021. Subject to receipt of all requisite
approvals and waiver or satisfaction of all relevant conditions,
closing of the Transaction is expected to be on or about
March 4, 2021.
The Transaction will consolidate the contiguous copper-gold
exploration and development assets of Kwanika and Stardust, both of
which will benefit from operational synergies as the projects
advance with a combined development strategy, along with the robust
portfolio of British Columbia
copper-gold assets held by the companies. The combined company will
be well positioned and capitalized as a result of the recently
completed $10,350,000 upsized
subscription receipt financing of Sun Metals (the
"Financing") to take advantage of a strengthening copper
market.
Upon completion of the Transaction, it is expected that
Mark O'Dea will assume the role of
Executive Chairman of Serengeti and the Serengeti board of
directors will comprise Mark O'Dea,
David Moore, Lewis Lawrick, Teodora
Dechev, Sean Tetzlaff and
Richard Bailes. David Moore will continue as Interim President
and Chief Executive Officer until such time as a full time CEO is
appointed, and Lauren McDougall will
assume the role of Chief Financial Officer and Ian Neill the role of Vice President
Exploration. Following the Transaction, current Sun Metals
shareholders, not including holders of Sun Metals shares issued on
conversion of the subscription receipts issued from the Financing,
will hold approximately 40% of the combined company.
Serengeti Meeting
At the Serengeti special meeting of shareholders, shareholders
will be asked to approve the Transaction. The Transaction
resolution must be approved by an affirmative vote of a simple
majority of the votes cast by Serengeti shareholders present in
person or represented by proxy at the meeting.
In addition to approving the Transaction, Serengeti shareholders
will be asked to approve resolutions to consolidate its common
shares on a two for one basis (the "Consolidation") and
amend and restate its stock option plan (the "Amended Option
Plan") to, among other things, become a rolling 10%
plan. Approval by Serengeti shareholders of these resolutions
is a condition to closing the Transaction. Disinterested
Serengeti shareholders will also be asked to approve resolutions
adopting a deferred share unit plan (the "DSU Plan") and a
restricted share unit Plan (the "RSU Plan"). The Amended
Option Plan, the DSU Plan and the RSU Plan are all subject to
approval by the TSX Venture Exchange.
The Consolidation is anticipated to be completed immediately
prior to closing of the Transaction. In addition to
shareholder approval, the Consolidation is also subject to approval
by the TSX Venture Exchange. Following the Consolidation, the
111,003,368 outstanding shares of Serengeti will be consolidated
such that there will be approximately 55,501,684 outstanding
shares, not including any Serengeti shares to be issued pursuant to
the Transaction. Serengeti also intends to proceed with a name
change in connection with the Transaction and Consolidation, which
name change will be subject to TSX Venture Exchange approval.
Further details with respect to the name change will be provided
when available.
Further details with respect to the Transaction, the
Consolidation, and the Amended Option Plan as well as the DSU Plan
and RSU Plan will be outlined in a joint management information
circular to be circulated to Serengeti shareholders in due
course. The joint management information circular will also
include instructions on how to vote and participate at the
Serengeti meeting scheduled to be held on February 26, 2021.
Sun Metals Meeting
At the Sun Metals special meeting of securityholders,
securityholders will be asked to approve the Transaction. The
Transaction resolution must be approved by an affirmative vote of:
(i) 66⅔% of the votes cast on the resolution by Sun Metals
shareholders present in person or by proxy at the meeting; (ii)
66⅔% of the votes cast on the resolution by Sun Metals
securityholders (voting as a single class) present in person or by
proxy at the Sun Metals meeting; and (iii) a majority of the votes
cast by Sun Metals shareholders present in person or by proxy at
the meeting excluding for this purpose votes attached to Sun Metals
shares held by certain persons as required under Multilateral
Instrument 61-101 – Protection of Minority Security Holders in
Special Transactions.
Further details with respect to the Transaction will be outlined
in a joint management information circular to be circulated to Sun
Metals securityholders in due course. The joint management
information circular will also include instructions on how to vote
and participate at the Sun Metals meeting scheduled to be held on
February 26, 2021.
Board Recommendations and Voting Support
The Transaction has been unanimously approved by the board of
directors of both Serengeti and Sun Metals. Both boards of
directors recommend that their respective shareholders and
securityholders vote in favour of the Transaction. The
Serengeti board of directors also recommends that Serengeti
shareholders vote in favour of the Consolidation, the amendment to
the Serengeti stock option plan as well as the DSU Plan and RSU
Plan.
All of the directors and officers of Sun Metals, holding in
aggregate 14.03% of the issued and outstanding shares of Sun Metals
and 15.38% of the outstanding shares, options and warrants of Sun
Metals, have entered into customary voting support agreements
agreeing to vote in favour of the Transaction. All of the directors
and officers and several large shareholders of Serengeti, holding
in aggregate 27.32% of the issued and outstanding shares of
Serengeti, have similarly entered into customary voting support
agreements agreeing to vote in favour of the Transaction.
This announcement is for informational purposes only and does
not constitute an offer to purchase, a solicitation of an offer to
sell any shares or a solicitation of a proxy.
About Serengeti
Serengeti is a mineral exploration company managed by an
experienced team of professionals with a solid track record of
exploration success. The Company is currently advancing its
majority-owned, advanced Kwanika copper-gold project and exploring
its extensive portfolio of properties in north-central British Columbia. Additional information can
be found on the Company's website at
www.serengetiresources.com.
About Sun Metals
Sun Metals is advancing its 100% owned flagship, high-grade
Stardust Project located in north-central British Columbia, Canada. Stardust is a
high-grade polymetallic Carbonate Replacement Deposit with a rich
history. Sun Metals also owns the Lorraine copper-gold
project, and the OK copper-molybdenum project.
On Behalf of the Board of Directors of Serengeti Resources
Inc.
"David W. Moore"
President, CEO & Director
On Behalf of the Board of Directors of Sun Metals
Corp.
"Steve Robertson"
President, CEO & Director
Neither TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Cautionary Statement Regarding Forward Looking
Information
All statements, trend analysis and other information contained
in this press release about anticipated future events or results
constitute forward-looking statements. Forward-looking statements
are often, but not always, identified by the use of words such as
"seek", "anticipate", "believe", "plan", "estimate", "expect" and
"intend" and statements that an event or result "may", "will",
"should", "could" or "might" occur or be achieved and other similar
expressions. All statements, other than statements of historical
fact, included herein, including, without limitation, statements
regarding anticipated benefits of the Transaction, the closing of
the Transaction, the Financing, the Consolidation, the Kwanika and
Stardust (the "Projects"), including anticipated operational
synergies between the properties, holding of a shareholder meeting
of Serengeti and securityholder meeting of Sun Metals are
forward-looking statements. Although Serengeti and Sun Metals (the
"Companies") believe that the expectations reflected in such
forward-looking statements and/or information are reasonable, undue
reliance should not be placed on forward-looking statements since
the Companies can give no assurance that such expectations will
prove to be correct. These statements involve known and unknown
risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated in
such forward-looking statements, including the risks, uncertainties
and other factors identified in the Companies' periodic filings
with Canadian securities regulators, and assumptions made with
regard to: the Companies' ability to complete the proposed
Transaction; the Companies' ability to secure the necessary
shareholder, securityholder, legal and regulatory approvals
required to complete the Transaction and meeting the other
conditions to the closing of the Transaction; the estimated costs
associated with the advancement of the Projects; and the Companies'
ability to achieve the synergies expected as a result of the
Transaction. Forward-looking statements are subject to business and
economic risks and uncertainties and other factors that could cause
actual results of operations to differ materially from those
contained in the forward-looking statements. Important factors that
could cause actual results to differ materially from the Companies'
expectations include risks associated with the business of
Serengeti and Sun Metals; risks related to the satisfaction or
waiver of certain conditions to the closing of the Transaction;
non-completion of the Transaction; risks related to reliance on
technical information provided by Serengeti and Sun Metals; risks
related to exploration and potential development of the Projects;
business and economic conditions in the mining industry generally;
fluctuations in commodity prices and currency exchange rates;
uncertainties relating to interpretation of drill results and the
geology, continuity and grade of mineral deposits; the need for
cooperation of government agencies and native groups in the
exploration and development of properties and the issuance of
required permits; the need to obtain additional financing to
develop properties and uncertainty as to the availability and terms
of future financing; the possibility of delay in exploration or
development programs and uncertainty of meeting anticipated program
milestones; uncertainty as to timely availability of permits and
other governmental approvals; and other risk factors as detailed
from time to time and additional risks identified in Serengeti and
Sun Metals's filings with Canadian securities regulators on SEDAR
in Canada (available at
www.sedar.com). Forward-looking statements are based on estimates
and opinions of management at the date the statements are made.
Neither Serengeti nor Sun Metals undertakes any obligation to
update forward-looking statements except as required by applicable
securities laws. Investors should not place undue reliance on
forward-looking statements.
SOURCE Sun Metals